giant chips Intel has reportedly told customers that it will raise the price of most of its microprocessors and peripheral chip products. According to a report in Nikkei Asia, the biggest US chipmaker plans to raise prices on flagship products such as central processing units for servers and computers as well as on a wide range of other items, including chips for Wi-Fi and other connectivity. In a statement Nikkei Asia, the company said, “On its Q1 earnings call, Intel indicated it would increase pricing in certain segments of its business due to inflationary pressures. The company has begun to inform customers of these changes.”
Why the price hike
Intel has reportedly cited rising costs for increasing prices. The company said that price hikes are required due to the surging costs for production and materials. Intel’s notice to clients comes at a time when almost the entire world is in the grip of severe inflation. In the US too, consumer prices reportedly rose 9.1% in June, a 40-year record.
How much will be the price increase
According to the report, the percentage increases have not been finalized yet. They could differ for different types of chips, “but are likely to range from a minimal single-digit increase to more than 10% and 20% in some cases.”
Intel is not the only one
The world’s biggest contract chipmaker Taiwan Semiconductor Manufacturing Company (TSMC) recently told clients that it will raise prices by a “single-digit” percentage starting in 2023. The company plans to increase prices for most of its fabrication processes by 6% starting from January 2023, as per a report in DigiTimes. In May, Bloomberg reported that Samsung is set to increase its chipmaking prices by up to 20%. Samsung, however, has not responded to the report. China-based relatively smaller chip maker Semiconductor Manufacturing International Corp too is said to have told investors that it will be raising its prices in view of the rising material costs.